2008, State of Portland Real Estate: Not Great
Posted on February 4, 2008
Filed Under Statistics, Portland, Selling Real Estate, Buying Real Estate, Real Estate, Marketing, General |
But, in my sunny optimistic way, not awful, either.
[Note for the record I’m an optimist, not an ostrich optimist. The former sees problems and calculates the odds of getting beyond them; the ostrich simply pretends the problems don’t exist (see: NAR).]
The good news is that activity has picked up dramatically in the last three or four weeks. Part of that is the normal new year ramp up, but a lot of it is pent up demand; buyers have been sitting on the side for nearly a year. Interest rates are still at crazy lows, and the chance that the conforming rate for loans may go from its current $417k to $729k in the stimulus package has heightened interest, certainly in places like Lake Oswego. Sellers for the most part have gotten the message on price - see chart below - and some listings have dropped 20% from their original listing price, some even more.
The bad news is, with tight mortgage qualification, the pool of buyers is considerably smaller than a year ago, so interest hasn’t translated yet into sales. Inventories are starting to rise again after the December shut-down, and months’ supply continues its upward trend. Year over year median price for closed sales for January was up slightly, but, for the first time in at least two years, YoY median for homes that went pending was down a little over 1.5%. Here are the January charts:
MEDIAN PRICE:
[Click on image for two page PDF]
Note, particularly, the median of homes for sale (red) continues down. Again, sellers have gotten the message, a very good sign. But it may not be enough; sales are still off:
UNIT SALES:
Oops. By the time final figures are in, YoY drop will be around 30%. Note that’s true in nearly all areas, including Lake Oswego, where median price is up nearly 10%.
MSI:
[Remember this template calculates MSI by dividing the number of homes listed on the last day of the month by the number of pending sales in the month; MLS divides by the number of closed sales.]
So. Even with a good economy, a relatively stable market compared to the rest of the country and low interest rates, we’re still looking at high inventory and diminished demand putting more downward pressure on prices, and more necessary acquiescence by sellers. Homes well maintained, well prepared, and well priced will sell; those that aren’t, even incrementally, won’t. I’ve said it before: buyers with good credit and a 20% down payment own the market. We’re not in a fire sale, but there are many, many good buys to be had.
This needs to be said as well: To find those good buys, or to sell effectively, it’s never been more important to be diligent in who you hire to represent you.
AREIL.
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3 Responses to “2008, State of Portland Real Estate: Not Great”
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[…] State of Portland Real Estate: Not Great TheBusinessEdition.com News wrote an interesting post today onHere’s a quick excerptBut, in my sunny optimistic way, not […]
I found your site on technorati and read a few of your other posts. Keep up the good work. I just added your RSS feed to my Google News Reader. Looking forward to reading more from you.
Eric Hundin
“Not great, but not awful”, sounds to me to be about right and guess what that’s not a bad thing…. there are cycles here and if you want the good times you accept that there will be bad times as well… that’s when you learn, build character, improve, and appreciate….